Charities have been forced to look closely at how their supporter data gets used if they licence it to third parties, which could see a new tracking solution or wider adoption of seeding by the sector. David Reed looks into the options available.
Since the media decided to monster the charity sector, it has become clear how little information data owners really have about the way their assets are being used. In just one example unearthed by the Daily Mail, a vulnerable consumer completed one lifestyle survey without ticking the opt-out and subsequently saw his data sold on 200 times, leading to 731 contacts.
As a direct result of the attention such cases have been getting, the Etherington Report has recommended the creation of a Fundraising Regulator who will put in place a Fundraising Preference Service, potentially modelled on the principles of the Telephone and Mailing Preference Services managed by the Direct Marketing Association. However, neither of those initiatives on their own will fill in the knowledge gap faced by every data owner who licences their data to third parties.
This is where data tracking services are stepping into the picture. Both existing and newly-proposed systems can chart the way data gets played out across the marketing eco-system once it has been released. This will rapidly become important as a way of demonstrating to regulators and legislators that the issue is being taken seriously.
As Jonathan Carter, head of strategy and consulting, Europe, at Acxiom, points out, “the Etherington Report was written by people who may not be fully aware of the forward-thinking and emerging capability within the marketing community in terms of data culture, data strategy and new data connectivity emerging both from the big data challenge and the convergence of traditional CRM first party data with anonymous on-line data.”
He adds: “The problem with only having a preference service along the lines of TPS/MPS is that it is a simple on/off option which, while perfect for blocking intrusive telephone calls and a deluge of direct mail, may force a too-simplistic choice and ethical dilemma for the consumer between saying they don’t want to receive marketing from any charitable fundraising organisation or taking no action.”
An opt-out preference service would not be a list of people who don’t want to donate, but rather one of people who don’t want to receive charity marketing activity. This option might not be viewed in a positive light, potentially being misinterpreted and unfairly viewed as a “Scrooge list” which runs counter to the obvious willingness to make charitable donations seen across the majority of the British public. If that happened, the service might not gain effective levels of adoption and legislators might be tempted to find other, potentially even more blunt alternatives.
“For the Fundraising Regulator to work in the way that is intended, it will need data on the collective activity of fundraisers towards individuals in order to monitor impact and compliance at the individual level. Just having an on/off is challenging. If you don’t opt-out, does that mean you are ‘fair game’ for everybody?” asks Carter.
He compares the challenge of creating this collective industry view of the impact on individuals from charity data-driven fundraising activity with connecting the ad impressions served to the same individual across multiple, different online behavioural advertising platforms. The aggregation of every click across an ad or publishing network into an anonymised persistent identifier proves that it is possible to achieve data tracking at the individual level at scale.
What Carter suggests is that a “Fundraising Safe Haven” model needs to be introduced which would run a similar anonymized data tracking process, but in reverse. Charities would provide their contact, transactional and campaign data sets to a trusted service provider which would integrate every source into an aggregated and anonymised view, much as data co-operatives currently do.
An anonymised persistent ID would be created and applied at an individual level which, through the use of appropriate data science techniques, would yield four important pieces of insight that could be made available back to the data providers (regulated charities) about their donors and supporters to help them self-regulate and drive better decision making in terms of how they target their fundraising marketing activity.
Firstly, each regulated charity could identify individual supporters who were at risk of being vulnerable using agreed parameters, such as age band or receipt of certain benefits. That would enable part of the critical screening dimension which Etherington has in mind. Secondly, the insight from the anonymized data pool could again help each regulated charity to identify their individual supporters who are at risk of being over-solicited with fundraising activity based on the sector-level view that the Fundraising Safe Haven generates.
Thirdly, individual supporters could be flagged who were potentially at risk of over-committing themselves financially, using affordability indicators to compare against transactional totals. Finally, a balance could be struck between an opt-out or opt-in preference centre, enabling individuals to select charities that they wished to receive fundraising requests from.
The Direct Marketing Association is exploring this model as part of its input to the Office for Civil Society, not least because of its ongoing experience running MPS and TPS. It appears to provide the right balance between the interests of government, the public and charities, while also generating information for the new regulator. “It is a principle and concept that sounds like a good idea. What it needs is to be owned by the charity sector to demonstrate a willingness to adopt new marketing and data solutions,” says Carter.
Despite the rapidly-moving position for charities, it is likely to be a few more months before agreement is reached on how to meet the Etherington report recommendations which have been fully supported by Rob Wilson MP for Reading and Minister for Civil Society. It is hard to see how some form of data tracking can be left out of the sector’s response, bearing in mind the shock with which the media, legislators and charities themselves greeted the findings about data usage and frequency.
But in many respects, this is not a new problem. “If you are a data owner, the challenge is knowing how your data is being used when it leaves your premises and goes out to resellers who may then licence it on to agencies,” says Christine Andrews, managing director at DataIQ Consulting.
For data owners who have made the decision to rent out their data in this way, tracking usage is a major consideration. It helps them to understand if they are receiving all of the revenue they are entitled to, it gives them another way in which to track compliance with licence terms (such as frequency or channel of use), and it also provides another check on the creative being used in campaigns (data owners have an obligation to ensure messages comply with the British Code of Advertising Practice).
Without tracking, it is easy to get a nasty shock like that delivered to charities by the Daily Mail. “One of our clients wanted to see how its licence holders were making use of its data. We found out that, in one day, there were 47 uses - 12 in one hour alone,” says Andrews. That particular instance involved a betting company using the rented data to promote its odds for a boxing match. On further examination, it turned out that a second, rival betting company was using the exact same data set at the same time.
Zoe Hewett, director of data programmes and seeding at DataIQ, says: “There is a moral obligation on data agencies to control what is being done with the databases under their control. With the risk that the whole permissioned data industry could disappear once the Data Protection Regulation is introduced, it is vital for them to see what’s happening now.”
DataIQ’s seeding programme provides an existing, proven methodology for enabling this data tracking. Data owners can introduce seed names into their database which are carefully constructed to be similar to other records they hold - if that requires a credit card or bank account information, seeds will be carefully merged with live data, for example.
“It is not a one-size-fits-all solution because it is important that seeds don’t stand out,” says Hewett. That prevents data users who licence the information from filtering out seeds so they can act on it without being tracked. Not surprisingly, many data owners who have deployed seeds also run audits on their licence holders to check their compliance - if an auditor discovers seed names in an unauthorised location, that can be investigated further.
As part of the programme, monthly reports are generated about the contact activity received. (DataIQ has live call answering as well as capturing every email or direct mail piece which gets sent to seeds.) Anything outside of licence terms will get flagged up. Says Hewett: “Every data owner will see some red flags over the course of a year. They might be legitimate and capable of being resolved or they could indicate misuse.”
If most charities had routinely seeded their donor databases, they might have been able to pick up on some of the abusive marketing identified by the media much earlier. Rogue call centres running “sucker lists”, for example, or calling after permitted hours or at high frequency would have been spotted through the call-recording protocol applied by DataIQ.
Andrews points to one poor practice that had become widely adopted which could have been stopped this way. “If a consumer said, ‘don’t call me again,’ those agencies were not taking them off the database, only off that campaign list. The consumer would specifically have to ask to be completely removed from the list. If you don’t track your data, you don’t know that is happening.”